Provisional applications: best practices

It is tempting, during a recession, to defer the cost of filing nonprovisional U.S. patent applications by filing provisional applications instead. Though this decision may result in immediate cost savings, problems can arise. Developing best practices to assess the benefits of provisional patent applications can eliminate risks and surprises.

Since their inception as part of the GATT Uruguay Round Legislation in 1995, more than 1 million provisional applications have been filed, and the number filed has increased every year until 2009, when the number dropped, along with the total number of nonprovisional patent applications filed. Unlike conventional nonprovisional patent applications, which can mature as a patent and include formal patent drawings, a specification and claims, a provisional application alone will never become a patent but will expire after 12 months unless refiled or converted to a nonprovisional application.

Provisional patent applications are typically less expensive than nonprovisional applications because drafting requirements are less stringent, they require no claims and filing fees are about two-thirds of those that apply to nonprovisional applications. Because provisional applications are not examined, no search fees or examination fees are required. This can result in cost differences of up to 50 percent to 70 percent, or more. Another potential benefit of filing a provisional patent application is the establishment of an earlier priority date for the purpose of determining prior art that might be considered when a Patent Office examiner reviews the patentability of a later-filed nonprovisional application. Provisional patent applications, once filed, also permit patent owners to mark their products with "patent pending."

Provisional applications do not detract from the term of enforceability accorded issued patents. If a nonprovisional application claims priority to a provisional application, the 20-year term of the nonprovisional application is calculated from the nonprovisional application's filing date, rather than the filing date of the provisional application. In certain fields, such as pharmaceuticals, it may be preferable to extend the expiration of the patent by a year due to the long time periods necessary to test a product or gain FDA approval. Alternatively, in some fast-moving technologies, such as electronics or computers, it may be desirable to secure full, enforceable patent rights as soon as possible. In this case, patent owners would want to avoid the extra year that a provisional application can add to the patent procurement process.

Taking advantage of lower initial costs, provisional applications are often filed by inventors who do not intend to commercialize their inventions themselves, but hope to sell or license them to third parties. Because the provisional application establishes both a description of the invention and the opportunity to file a nonprovisional application within a year of its filing date, the inventor has a one-year window of opportunity to offer his invention to others, and to seek funding while determining whether it has potential in the marketplace. A provisional application can be assigned, and the assignee can then invest the money necessary to file and prosecute a nonprovisional application, shielding the inventor from that expense. Multiple provisional applications can be combined into a single nonprovisional application.

Perhaps the most significant consideration that can arise from provisional patent application practice is inherent in what makes it attractive to many inventors. Because provisional applications are often filed to avoid the costs of preparing a nonprovisional application, many applicants file too little disclosure or fail to explain their invention in sufficient detail. The 2002 Federal Circuit case of New Railhead Mfg., LLC v. Vermeer Mfg. Co. demonstrates that provisional applications must disclose all that is claimed in the nonprovisional application for the nonprovisional application to have the benefit of the provisional's earlier filing date, in addition to providing an enabling disclosure as required by the patent laws. The difficulty of ensuring a full disclosure is exacerbated by the fact that provisional applications do not require claims, and often do not include them. So the check that most patent attorneys perform when drafting nonprovisional applications - namely, ensuring that claim language finds direct support in the specification of the application - often cannot be done when filing a provisional application. If the priority claim is denied, significant patentability problems can arise, particularly when the inventor has attempted to sell the invention to investors before filing his or her provisional application. These problems can be so serious as to preclude a nonprovisional patent application from ever issuing.

Finally, as provisional practice merely defers the costs attendant to the preparation of a complete nonprovisional application, many patent filers opt to prepare detailed provisional applications that look, to all purposes, like a nonprovisional application. This not only minimizes the likelihood of problems stemming from an inadequate disclosure, but can also reduce overall drafting costs.

The assistance of Jonathan Thielbar with this column is gratefully acknowledged.